Abstract

On June 7, 1991, the Spanish Parliament approved a reform of the personal income tax with effect from January 1, 1992. The guidelines of the reform are similar to those implemented in other industrial countries. There is an intention to simplify the tax system (by reducing the number of taxes, rates, and special regimes), to make it as neutral as possible (in the sense of minimizing distortions in resource allocation), and to reduce income tax progressivity. The reform aligns taxation of capital income of residents with the most liberal practices in the EC and eliminates most taxes on capital yields earned by nonresident investors in Spain.

Cited By

Converging with the European Community
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